Even the Banks are Paying a Penalty for Sandy

December 12, 2012

Even Lamborghinis float. Just ask the staffers at the W Hotel next to the World Trade Center site, who saw one bobbing by last October when Sandy sluiced through the streets, onto the sidewalk, and into the lobby. When the water receded, it took with it power, countless jobs, and 42 lives throughout the city. The staff at the hotel’s restaurant, BLT Bar & Grill, were out of work for two weeks. They were lucky.

“85 West just called a staff meeting last night,” says BLT’s manager, Pamela Friedl, pointing to a bar across the street. “They had to lay off everyone.”

Sandy was an equal opportunity destroyer, and, for once, even the palaces of finance have paid a penalty. Entire office buildings along Water Street will be out of commission for months. Corporate banks, like Citibank at William and Broad streets, are shuttered. Caravans of generators trucked in on semis line the sidewalks. Entire streets are blocked off, seemingly forever.

But the banks and brokerages are able to simply migrate away from the mess; it’s the businesses built to serve them that might be facing a terminal prognosis. South Street Seaport remains a post-retail wasteland. Storefronts everywhere are boarded up or shattered and tarped over, their insides stripped. The financial district’s small-business owners were hit the worst. “Downtown’s like a war zone,” says Jeffrey Bilfeld, owner of an eyeglasses shop, Optical Insight, on Hanover Square. “It’s worse than 9/11 as far as devastation goes.” Bilfeld has no idea when he’ll reopen—and has no money to fix up his place. “We’re not getting any money from FEMA because it’s not a house,” he says. “And insurance companies aren’t paying anybody, even though we have disaster insurance.”

Mary Murphy, the owner of Athea Kitchens next door, had invested her personal savings into the store, and now she’s bleeding so many clients she put her personal cell number on the door to coax back anyone she can. The city hasn’t told her when she’ll be able to reopen and start earning again. “But the city couldn’t have done anything better,” she says. “What can you do in a disaster? That’s what they are—disasters.”

Zigolinis, a sprawling restaurant that takes up much of a block on Pearl Street, is still closed.

“The entire restaurant got destroyed,” says Dalio Calado, a partner. “The basement had water up to the ceiling. The main floor had two feet of water. It took us a week to pump it out. We’ve had several inspections by the insurance companies, but they’re trying to bail on us, saying they’re not going to cover flooding. It’s a war, man. We can do nothing.”

Without help from FEMA and insurance companies ignoring them, some store owners, like Esther’s Shoe Repair’s Yona Bachayev, have looked elsewhere for money. Bachayev is applying for the Lower Manhattan: Back to Business small-business grant. “It’s not that much,” he says. The $20,000 grant, intended for eligible businesses in Zone A, is largely funded by corporations, including AT&T, Goldman Sachs, and Citibank. Trinity church has chipped in at least $1 million. “But every little bit helps,” Bachayev says. “We’re really suffering.”

The biggest losers in all of this are the bar and restaurant staffs across the neighborhood. Stone Street’s restaurant row has mostly reopened, but the cobblestone alley is empty. For the workers who get paid half of the minimum wage and make their living on tips, the exodus of workers is crippling.

Around the corner on William Street, Luke’s Lobster was still without power last week. Eating a takeout burger and reading a book by candlelight, general manager Andrew Benson sits inside by the front window. “Everything in the basement had to be thrown away,” he says. “All our inventory, the computers . . . the wall, the ceiling.” Sandy turned his walls to mush.

Benson’s staff is lucky: They’ve been making ends meet by filling in at one of the three other Luke’s locations in the city. “Everyone signed up for FEMA unemployment,” he says. But while FEMA tries to help anyone who has lost a job, the agency only pays a fraction of a normal paycheck. “They’re all surviving,” Benson says. “They just want to get back to work.”